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Nominee for SEC Chair To Testify Before Senate Committee

March 2, 2021

Gary Gensler, nominated by President Biden to serve as Chair, Securities and Exchange Commission, will testify tomorrow before the Senate Committee on Banking, Housing and Urban Affairs. Mr. Gensler stresses strengthening transparency and accountability for the markets “so people can invest with confidence, and be protected from fraud and manipulation. . .” according to his brief prepared remarks for the Committee. Throughout those remarks Mr. Gensler stresses his experience and knowledge of the markets, developed…

SEC Actions

This Week In Securities Litigation (Week of March 1, 2021)

By Thomas Gorman

February 28, 2021

Later this year the United Nations will its Climate Change Conference. The event, to be held in November, was originally scheduled for last fall but was postponed in the wake of the pandemic. Perhaps by the time of the Conference the Division of Corporation Finance will have developed proposed regulations to update the Commission’s climate disclosure standards under the directive issued last week by the Acting Chair. The development of new standards in this area,…

SEC Actions

SEC Acting Chair Directs Study of Climate Change

By Thomas Gorman

February 25, 2021

Acting Chair Allison Herren Lee directed the staff of the Division of Corporation Finance to “enhance its focus on climate-related disclosure in public company filings.” Presumably this directive is to focus on updating the Commission’s only existing disclosure requirements regarding climate change. Those were, as the Acting Chair stated, passed in 2010 (here). The directive is an important step. As a leading setter of disclosure standards, it is critical that the SEC update…

SEC Actions

Nasdaq Rebuked by GOP Senators for Board Diversity Requirements

By Thomas Gorman

February 24, 2021

Nasdaq filed a proposal with the Securities and Exchange Commission on December 1, 2020 to modify its listing standards to embrace diversity (here). Specifically, the exchange proposed to require companies listed on Nasdaq Global Select Market and Nasdaq Global Market to have two diverse directors within four years of the time the Commission approves the proposed rule. Firms listed on Nasdaq Capital Market would be expected to have two diverse directors within five…

SEC Actions

Climate Change, A Key Issue For World Regulators

By Thomas Gorman

February 23, 2021

Climate change is an often talked about issue. Some firmly believe in it; others do not. Regardless of your view, there is a significant quantum of information available on the subject. There is also no doubt that climate has an impact on business enterprises and the ability to deliver services or product. Viewed in this context, many investors may want to know how executives making critical decisions about the use of investor capital consider the…

SEC Actions

This Week In Securities Litigation (Week of Feb. 22, 2021)

By Thomas Gorman

February 22, 2021

GameStop continued to be the topic de jure last week with hearings on Capitol Hill before a Congressional Committee. The key players were present, including the founder of Robinhood. Each appeared and testified. While the hearings made for interesting media at times, little appeared to have been accomplished beyond the usual theatrics. If improvements to the trading system are going to evolve from this incident look for them to come from the report the SEC…

SEC Actions

SEC – Morningstar Litigate Validity of its Ratings Process

By Thomas Gorman

February 18, 2021

Seldom does the Commission litigate with a major business entity. Conventional wisdom says that the cost in terms of executive time, the distraction and of course the legal fees to contest an agency enforcement action are not worth it. The prudent course is to settle, pay the fines and move on. Yet recently, a major credit rating agency chose not to settle with the agency. Rather, an enforcement action was filed claiming disclosure violations and…

SEC Actions

This Week In Securities Litigation (Week of Feb. 16, 2021)

By Thomas Gorman

February 15, 2021

The more things change, the more they sometimes seem to stay the same. Take obtaining a formal order of investigation. For much of time the Commission has been in existence the staff prepared a memo submitted to the Commission requesting that a formal order be issued. which it considered and then made a decision. A few years back that practice was changed, delegating authority to the staff. Then it was changed back. Now the Acting…

SEC Actions

Investment Advisors in the Cross-Sights

By Thomas Gorman

February 12, 2021

Investment advisers have become a primary focus of Commission enforcement actions in recent years. The trend began several years ago and continues. Now each year cases involving investment advisers are one of the largest categories of cases brought by the Commission each year. The two cases discussed below – each recently filed – are examples of this trend. SEC v. Goodman, Civil Action No. 21-cv-00365 (D. Minn. Filed Feb. 8, 2021) is an action which…

SEC Actions

The Deal Target Got Away; the Trading Executive Did Not

By Thomas Gorman

February 8, 2021

Insider trading has long been a key focus of the Commission’s enforcement program. In recent months interest seems to have shifted to offering fraud cases and those involving microcap securities. Yet Commission’s most recent insider trading cases is classic, almost — a former corporate board member and then consultant who worked on a lost acquisition target charged with insider trading by the Commission and DOJ. SEC v. Ahn, Civil Action No. 1:21-cv-10203 (D. Mass. Filed…

SEC Actions

Blog Authors

Nominee for SEC Chair To Testify Before Senate Committee

This Week In Securities Litigation (Week of March 1, 2021)

SEC Acting Chair Directs Study of Climate Change

Nasdaq Rebuked by GOP Senators for Board Diversity Requirements

Climate Change, A Key Issue For World Regulators

This Week In Securities Litigation (Week of Feb. 22, 2021)

SEC – Morningstar Litigate Validity of its Ratings Process

This Week In Securities Litigation (Week of Feb. 16, 2021)

Investment Advisors in the Cross-Sights

The Deal Target Got Away; the Trading Executive Did Not

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